September 25, 2006
Investor Confidence and Differences in Regulatory Standards
The debate rages across the Atlantic (and the Internet) over the competitiveness of U.S. Capital markets and markets such as the AIM on the LSE. One of the culprits being blamed for the increase of IPOs in non-U.S. markets is the whole concept and application of governance and compliance standards and their impact on investors and new public offerings.
The AIM prides itself on "flexible regulatory regimes". That phrase reminds me of Groucho Marx and his quote, "Those are my principles. If you don't like them I have others." Discussion is underway in the U.K. to consider higher required compliance standards for AIM filers. Click here to get a fascinating look into the debate going on in London.
Clearly investors need to treat listings on the AIM with more caution and a greater risk premium. I suspect that if the compliance standards were higher the quality of the listings on the AIM would be higher, there would be fewer listings, and the market premium greater. Click here for a previous blog post (August 24, 2006 - Ready, AIM, but don't head Higher!) with additional background.
The other trend that is clear is that markets such as AIM are under pressure to raise the bar to meet U.S. standards, just as U.S. markets are under pressure to deal with all factors contributing to IPO costs.
If your company is U.S., or based outside of North America, and needs to comply with SOX efficiently and without the drama please visit http://www.issuescentral.com/ to learn more about the Compliance Playbook(TM).
If you are a Canadian-based filer needing to comply with either SOX or MI 52-109 please visit the website of our exclusive Canadian distributor, Thomson Carswell, at http://www.compliancepartner.ca/ to learn about Compliance Partner(TM), plus their new product for the Mining Sector, Compliance Partner(TM) - Mining Edition.
The AIM prides itself on "flexible regulatory regimes". That phrase reminds me of Groucho Marx and his quote, "Those are my principles. If you don't like them I have others." Discussion is underway in the U.K. to consider higher required compliance standards for AIM filers. Click here to get a fascinating look into the debate going on in London.
Clearly investors need to treat listings on the AIM with more caution and a greater risk premium. I suspect that if the compliance standards were higher the quality of the listings on the AIM would be higher, there would be fewer listings, and the market premium greater. Click here for a previous blog post (August 24, 2006 - Ready, AIM, but don't head Higher!) with additional background.
The other trend that is clear is that markets such as AIM are under pressure to raise the bar to meet U.S. standards, just as U.S. markets are under pressure to deal with all factors contributing to IPO costs.
If your company is U.S., or based outside of North America, and needs to comply with SOX efficiently and without the drama please visit http://www.issuescentral.com/ to learn more about the Compliance Playbook(TM).
If you are a Canadian-based filer needing to comply with either SOX or MI 52-109 please visit the website of our exclusive Canadian distributor, Thomson Carswell, at http://www.compliancepartner.ca/ to learn about Compliance Partner(TM), plus their new product for the Mining Sector, Compliance Partner(TM) - Mining Edition.
